MUNICIPAL FINANCE.

New Zealand Herald, Volume XLV, Issue 13768, 5 June 1908, Page 6

MUNICIPAL FINANCE.

BIG LOAN PROJECTED.

THE MAYOR OPTIMISTIC.

PROPOSAL TO RAISE £100,000.

PROGRESSIVE MUNICIPALI

THE GROWTH OF THE CITY

In- the Finance Committee's report presented to last night's meeting of the City Council the estimates of receipts and expenditure for the current year were submitted for consideration, together with a recommendation to ask the sanction of the. ratepayers for the raising of a. loan of £100,000 for various works'within the city. Both of these matters were fully dealt with by Hie Mayor (Mr. A. M. Myers) in .a speech reviewing the whole position. Dealing with the general account, the Mayor said the year had commenced with a debit balance of £29,603. which was due to advances made on account of loans, and would bo reimbursed when the. loans were floated. The estimated receipts from sources other than rates were £24.375. A general rate of lid in the £ on the valuation, £505,553, would produce (less probable arrears £250) £22,921, leaving to be provided from water account £24,873, while the estimated expenditure was made up as follows: — Salaries and allowance* £ o'nnn Office expenses f™U Fire Brigade ... £.000 Parks and reserves ... ... ■ - 3,<UU Streets maintenance (includes light- _ ing £2400 and tree-planting £300) 30,200 Street, works in hand, or requiring •to be done • i ... 15-000 Grafton Bridge—purchase of land unci house 3,000 Sinking.fund l.*» Other sundries ••• °-°™ Transfer to Domain trust account o*:u Transfer to improvement trust account 10U . £72,169

It would be noticed, continued the Mayor, that the Council was providing the sum of £45,200 for expenditure on streets; but although, this was a considerable amount itwas not more than was necessary, and it was quite clear that they must be prepared to face a large expenditure in this direction. The engineer informed him that the increased expenditure required on street maintenance was due to a- number of causes, the principal of which were the growth of traffic, the activity in the building trade resulting in the opening of a largo number of cross trenches, which had a very serious effect on road surfaces; the higher standard of efficiency required, whether in the direction of watering and cleansing or the general repair of streets; the increase in wages and the price of materials,' which had added 20 to 30 per cent, to the .cost of upkeep: the fact that- the water used on streets and in conveniences was now charged for; the upkeep of conveniences, which had been brought up to date; the maintenance of the asphalt pavement in Queenstreet, which appeared this year for the first time, and added £650 annually to the upkeep of this street. Further, more special works were necessary now, both because works that should have' been undertaken by. 'former Councils were neglected by them, and also on account of the expansion and. development of the city, and tire growth of a higher- and more progressive municipal standard. \

Of the waterworks revenue, the Mayor said, it was proposed, as had been, indicated, to transfer £24.873 to general account. The expenditure would amount- to over £30,000, leaving a prospective credit balance of £6440 at March 31, 1909. The estimated receipts for the year were £34,950, which, with the balance in hand of £27,013, made £61,963. The estimated expenditure on the full library account was £2759 (£BOO for strongroom for the Grey collection, and £614 for new book?-), and of the receipts a id rate would produce £1042. The amount spent last, year in the purchase of books was £287.

It Mas estimated that the sanitation account would show a. credit balance at the end of the year of £413, which, with expenditure, would make £5656. A rate of 2>id in the £ would realise £4976. The Council's contribution for charitable aid was estimated tit £6399. and a. similar rate would provide £5216, the prospective debit balance.being £499. The electrical supply account opened the year with a debit balance of £458. This, however, together with any deficit there might be ou the current year's working, would ultimately be wiped out by the profits arising from this department as soon as the installation was in full swing.

The amount to credit of the tramways profits account on March ,31, 1908, was £9382, out of which £3675 had been allocated as sinking fund on old loans, for which no sinking fund was originally provided, leaving £5707 now available, which would be increased during the year by any further payment received from the Tramways Company.

PROPOSED NEW LOANS."We all believe that Auckland has a great future before it," continued the Mayor, "and that,it is therefore consistent with, and indeed essential to, prudent administration that the various improvements rendered necessary by the growth of the city should be carried out on progressive lines." With this end in view, the Council was suggesting that, in addition to the sums to be spent out of revenue on various works, the ratepayers should be asked to sanction a loan of £100,000, to be allocated a.s follows: — £ Arclihill reservoir and pipes ... 20,000 KhybiT Pass reservoir (including land) and pipes 20,000 Morgue 1,000 Parks and Domain 3,000 Custom-street West alterations ... 15,000 Syrnonds-street, widening and compensation for hind 4,000 High-street, widening and compensaI tion for land 5,000 , Various street works 32,000 £100,000

Interest and sinking fund on the £40,000 proposed to he spent on reservoirs will be charged to water account, which it could well bear. The tramways profits would provide the sinking fund on the, remaining £60,000, and with the number of new buildings which wouid be erected, and the increase in the valuations which must take place by the time this loan is issued, the interest account will be able to bear the charge of the interest, which, say, at 4£ per cent., would amount to £2700; so that there would be no necessity for any increase in the rates in this connection. The reservoirs were absolutely necessary, and a morgue was also urgently required. The improvements to the parks. and Domain were not matters of quite such urgent necessity, but it was certainly the duty of the municipality to do everything possible to beautify the city. As regards the remaining loans, for street works, as he had already pointed out the necessary expenditure- on streets must for the next few years, for various reasons, be abnormally high. It must be remembered that, all wise expenditure on improvements to the city would add to its capital value, and it was only by carrying out such improvements in a progressive and far-seeing spirit that they could enable Auckland to

attain to the.dignity.and beauty which the generous endowments of nature gave it the opportunity.of possessing. CITY'S INDEBTEDNESS. The figures in relation to the city's indebtedness were as follow: — - Indebtedness on March 31, 1908... £813,600 Less accrued sinking fund unci amount, allocated from tramway profits for sinking fund on old loans - 116 - 353 Net indebtedness - "£702.267 To which must be added loans authorised, but not yet floated, viz.: final instalment (drainage), under Borrowing Act, 1899 10,000 Balance Grafton Bridge loan ... 25,300 Town Hall .' 80,000 Electric lighting, second instalment ... ... .-- 50,000 Main drainage, first instalment... 50,000 Proposed new loans 100,000

Total indebtedness would then be £1,017,267

"To sum up," concluded the Mayor, "we propose to spend out of revenue £45,000 on our streets. *£5700 on parks and reserve*, £1400 on th Domain, £3000 on the fire brigade. £-10,000 for supplementary trunk water mains. £6599 for charitable aid, £4965 for sanitation, and £2759 foi maintenance, repairs, etc., and books at the Free Library; and when this can be done, and interest paid both on present and proposed loans, on rates amounting to only 2s "id in the £ (exclusive of water rates), we may fairly claim that our policy combines progress with prudence."